Gen Y'ers are money conscious and better savers than their Boomer parents. Or so claims a recent piece in Time, which reported that Gen Y is more optimistic about its financial future and taking steps to ensure post-career prosperity than those approaching retirement.
Sensing the survey numbers might not tell the whole story, I set out to talk to other Millennials about their saving habits and those of their peers to confirm whether fiscal prudence is a generational virtue and to determine what kind of influence Mom and Dad were when it comes to money.
Here's what they told me:
What motivates you to save?
"I'd call it a product of my upbringing. My parents both had blue collar jobs and didn't make a lot of money. They did what they could, but I learned to live with 'needs' instead of 'wants,' as my mother always put it. I probably wouldn’t have become the person I am without such an upbringing, and I'm very thankful for it. I have excellent credit and after recently selling my home, my only debt is about $7000 in student loans. I have no credit card debt and I'm satisfied with a trusty Jeep that paid off a few years ago that now has over 160,000 miles."
Tim Russell, 29
Are members of Gen Y better savers than their parents?
"I don't think so, no. We're a generation that works hard and plays hard. I think if you're raised in a household where being smart about money is not an objective, that you may in the long run actually inherit those traits. If Gen Y is raised by a spendthrift Boomer population, it might actually stand that the system continues unless someone does something about it."
Mehnaz Thawer, 29
How has the recession affected your money habits?
"It's a little hard to factor in how the recession affected my attitude towards money – I was a poor college student when the recession first started and I think my attitude towards money really hasn't changed much. I'm always minimizing my spending, justifying purchases, and trying to do my best to maximize what I get for what I spend. I think the recession just solidified my already existing belief that money is meant to be earned, saved and spent carefully. Watching my husband – five years older – and his peers I think they've loosened up a bit recently. When the recession first started, they all joined right in on my meager ways and now things are a bit more stable – and they seem more secure in their jobs – so they are more likely to eat out, treat themselves to a movie or new toy, etc. This still makes me uneasy, but I can feel myself joining them now and again. So maybe that means it's a short term thing. They certainly are approaching this recession as a blip – something for them to get through before life gets back to normal."
Laura Jane Schaefer, 26
How do your saving and spending habits compare to those of your peers?
"Sometimes, I feel like I can't even relate to my peers. They spend like drunken sailors. Cars, TVs, iPhones, eating out, you name it. I once had a friend with two kids, three cars, a mortgage, and a stay at home wife mind you pull me aside and lecture me on the need to put away that extra $200 each month. $200 a month? That's only saving $2400 a year! That will pay two years of college for one of your kids if you're lucky. Another couple we know eats out almost every day. It's excessive.
I love living frugally. I live in a one-bedroom apartment in Pittsburgh with my wife, we bus/bike to work, buy locally, and enjoy the little things in life. There's no need to spend money just because you can."
Andrew Fournaridis, 25